- Time spent researching resumes
- The effort to contact candidates (email, phone, other)
- Scheduling and conducting interviews
- Company and industry knowledge lost
- Time to get up to speed
Other factors such as search fees, impact on the organization, and expenses to relocate key employees can add thousands of dollars to the replacement cost.
It is important to prevent employees from leaving the company for reasons that can be easily addressed. For example, understanding what salaries are for any given position is important. Salaries should be based upon experience, company size, geography and, of course, responsibilities and function. Bargain employees will at some point need to receive increases or you should expect them to move on when other opportunities present themselves. Less obvious ways of retaining good employees are to provide a pleasant and exciting workplace. Learn to create a diverse environment that shows its appreciation for hard work and success. Engage the members of your company or team as individuals and as members of the group. Remember to communicate goals and objectives so everyone understands their role and how to contribute to the success of the company. Finally, know when to let go and do so in a professional manner. Let key employees leave with dignity and an understanding that they will be missed. Let the remaining employees see how the departure is handled so they understand your appreciation of their efforts.
Creating a company culture is not done by accident. It is deliberate, planned and modified just as any other business process. The Institute for Research on Labor and Employment, University of California, Berkeley found that turnover costs for a manager average 150% of salary, including both tangible and intangible costs such as fees, training, the new worker's inefficiency and lost productivity while the job is vacant.
Review your efforts to create a positive work environment where employees are rewarded for their efforts, recognized for superior achievement and shown that they are appreciated regularly. As our labor pool gets smaller due to an aging population and opportunities to pursue other positions increase with an improving economy, those efforts will be rewarded.
The Best of the Blog 2011 is now available. In it you will find some of the most read blogs, important blogs and our favorite recipes of the year. Enjoy!